---
title: "4 Years, 15 Lawsuits, Claims of 4.7 Billion, Payouts of 29.8 Million: Can JDB Overcome This Crisis?"
description: "JDB has been embroiled in legal battles with Wanglaoji for four years, facing 15 lawsuits, with claims totaling 4.7 billion yuan and payouts of 29.8 million yuan. Amid executive departures and factory shutdown rumors, the company's future hangs in the balance."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2016-09-22"
categories: "Brand Marketing"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/xzwTAoxcdjfAFAcrTW0vlw"
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citation: "New Distribution. “4 Years, 15 Lawsuits, Claims of 4.7 Billion, Payouts of 29.8 Million: Can JDB Overcome This Crisis?.” New Distribution, 2016-09-22. https://xinjignxiao.com/en/articles/4-years-15-lawsuits-claims-of-4-7-billion-payouts-of-29-8-million-can-jd-ae1752b5/"
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# 4 Years, 15 Lawsuits, Claims of 4.7 Billion, Payouts of 29.8 Million: Can JDB Overcome This Crisis?

> JDB has been embroiled in legal battles with Wanglaoji for four years, facing 15 lawsuits, with claims totaling 4.7 billion yuan and payouts of 29.8 million yuan. Amid executive departures and factory shutdown rumors, the company's future hangs in the balance.

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Before JDB and Wanglaoji went to court, no one imagined that a small can of herbal tea could cause such a stir, but it has proven that the legal entanglement between these two herbal tea giants has lasted four years and involved as many as 15 lawsuits. According to reporters' statistics, among the ongoing or concluded lawsuits, JDB has mostly ended up on the losing side.
The most notable is that, according to data provided by Wanglaoji's legal department, in the total lawsuits over the years, Wanglaoji's claims against JDB amount to 4.7 billion yuan, and in cases with final judgments, JDB has already paid 29.8 million yuan. Coupled with recent rumors of executive departures and factory shutdowns, JDB finds itself in a state of "internal and external troubles." Can JDB smoothly weather this crisis? The outside world is eagerly watching this most marketing-savvy herbal tea company.
**15 Lawsuits Pending**
In recent years, around issues such as the "Wanglaoji" trademark, advertising slogans, and packaging, Guangzhou Pharmaceutical Group and JDB have engaged in multiple rounds of confrontation.
According to data obtained by reporters on the lawsuits between the two parties, there are currently 15 lawsuits, of which 7 have been finally adjudicated and compensation procedures completed, with JDB having paid the relevant amounts as per court judgments. The data shows that in the total lawsuits over the years, Wanglaoji's claims against JDB amount to 4.7 billion yuan, and in cases with final judgments, JDB has paid 29.8 million yuan.
In 2012, Wanglaoji and JDB fought their first lawsuit, where Wanglaoji regained the trademark and won. It was thought that China's No. 1 trademark case had long been settled, and the two companies would go their separate ways. Unexpectedly, in the following years, the disputes between Wanglaoji and JDB never ceased.
The origin of the lawsuits dates back 20 years when Wanglaoji's parent company, Guangzhou Pharmaceutical Group, granted the trademark to JDB's parent company, Hongdao Group. Since the "Wanglaoji" trademark is owned by Guangzhou Pharmaceutical Group, in 1995, Hong Kong's Hongdao Group obtained a 10-year usage right to the "Wanglaoji" trademark through a licensing agreement. Subsequently, Hongdao Group launched red-can "Wanglaoji" herbal tea, which achieved great success. In 2002, Hongdao Group renewed the "Wanglaoji" trademark through certain means, extending its usage period by 10 years. In 2011, Guangzhou Pharmaceutical Group believed the contract renewed through illegal means was invalid, so it demanded the return of the trademark and compensation for economic losses.
Since then, China's No. 1 trademark case began, with the most significant cases including Guangzhou Pharmaceutical Group suing for infringement of the "Wanglaoji" registered trademark, requesting the Guangdong High Court to order Guangdong JDB to compensate 1 billion yuan in economic losses. Later, in February 2015, the claim was increased to 2.93 billion yuan.
Additionally, in June 2015, Wanglaoji filed a lawsuit against JDB to ban the red can and claim 1.5 billion yuan in damages, and in July of the same year, the court ordered JDB to stop using advertising slogans such as "JDB herbal tea has been awarded 'China's No. 1 Beverage Can' for 7 consecutive years" and "JDB has won 'Seven Consecutive Championships' in China's canned beverage market," and to compensate Wanglaoji for economic losses.
From the history of the feud between JDB and Wanglaoji, it can be summarized that from name change to packaging change to advertising slogan change, JDB's transformation history is a "history of paying compensation."
However, JDB does not seem concerned about the huge compensation amounts. A JDB spokesperson told reporters that since JDB is not a listed company, it cannot disclose the proportion of compensation to company performance, but it is certain that these payments have not affected the company's sales.
In contrast, its competitor Wanglaoji, being a listed company, has transparent sales data. According to Baiyunshan's (24.660, -0.05, -0.20%) 2015 annual report, in the health sector, red-can Wanglaoji achieved revenue of 7.768 billion yuan in 2015, a year-on-year increase of about 9%, and net profit of about 390 million yuan, a year-on-year increase of about 15%. Wanglaoji stated that the faster growth in net profit compared to revenue was mainly due to reduced promotion expenses; green-can Wanglaoji turned losses into profits, contributing investment income of about 8.08 million yuan.
If calculated based on comparable net profits between JDB and Wanglaoji, the compensation paid over the years accounts for 7.6% of JDB's annual net profit.
**Response: All Executives on Duty**
Having lost multiple lawsuits but gained fame, JDB's marketing capabilities have been emulated by FMCG companies. It is well known that every time JDB loses a lawsuit, it faces a change, and each change may cause major internal turmoil, which could potentially lead to a "gradual fading from the consumer market."
On September 14, citing former JDB employees, reports claimed that production lines at JDB factories in Fujian, Zhejiang, Beijing, and other places had successively halted, nearly half of the group's only ten senior managers had left, and former executive president Yang Aixing had resigned at the end of 2015, with party secretary Pang Zhenguo rumored to be leaving soon.
"Currently, all company executives are on duty, with none having left; all employee salaries are paid on time, benefits are normal, and promotions and salary increases are proceeding normally. At present, JDB's production and operations with partners are normal and stable," JDB officially responded to our reporter.
However, according to our reporter's understanding, employees in the media relations department have seen high turnover in recent years. In response, a JDB spokesperson explained to our reporter that senior executives like Director Yang would not easily leave the company. Approaching the double festival, with all factories running at full capacity, JDB herbal tea is in short supply in the market, so the claim of factory shutdowns does not hold.
It must be admitted that to this day, JDB has balanced product sales and consumer awareness during its "de-Wanglaoji" process. For example, before the "Wanglaoji trademark case" was adjudicated, JDB had already prepared for a name change. It invested heavily in advertising, promoting the message "Wanglaoji red-can herbal tea renamed JDB, same formula, same familiar taste," to deepen consumers' impression that "JDB is Wanglaoji." Additionally, JDB sponsored "The Voice of China," further enhancing its visibility.
In fact, after all the legal battles, the outside world still cares about the question: "Who is the leader in herbal tea?"
According to the "2015 Beverage Industry Overall Operation Report" released by the China National Food Industry Association, the herbal tea beverage market sales revenue exceeded 50 billion yuan in 2015, a year-on-year increase of 10.6%, ranking as the fourth largest category in the beverage industry.
However, according to multiple public materials from Wanglaoji in 2015, herbal tea beverage sales exceeded 20 billion yuan in FMCG terms, with distribution completed in large supermarkets, wholesale shops, catering channels, and internet e-commerce. So, without clear data, it is difficult to determine who is the current leader.
Regarding sales data, JDB, in an interview with reporters, also cited data from the China National Food Industry Association: this year's "2015 Beverage Industry Overall Operation Report" shows that JDB brand herbal tea holds a 52.1% sales market share, ranking first in China's herbal tea industry; in the entire canned herbal tea market, JDB brand herbal tea holds a 70.6% sales market share, ranking first in China's canned herbal tea market.
According to information published on Baidu Baike, the China National Food Industry Association is a self-regulatory industry management organization for the national food industry, established on October 29, 1981, with the approval of the State Council. It is worth noting that previously, JDB's external promotional data used the China Industry Enterprise Information Center, claiming to be the No. 1 in canned beverage sales in 2013, but later that association was questioned for selling rankings under the false name of the National Bureau of Statistics.
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## Citation metadata

- Publisher: New Distribution
- Author: New Distribution
- Published: 2016-09-22
- Canonical: https://xinjignxiao.com/en/articles/4-years-15-lawsuits-claims-of-4-7-billion-payouts-of-29-8-million-can-jd-ae1752b5/
- Original source: https://mp.weixin.qq.com/s/xzwTAoxcdjfAFAcrTW0vlw

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